The Atlantic Casino Tax Break Law Dismissed by New Jersey Superior Court

Arsenii Anderson
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The Atlantic Casino Tax Break Law Dismissed by New Jersey Superior Court

A state statute that exempts the casinos in Atlantic City from taxes has been thrown out by a judge in the New Jersey Superior Court. According to the judge, the statute is unconstitutional under state law. Due to this decision, casinos will now miss out on tens of millions of dollars in tax savings.

Casinos in Atlantic City have taken a significant hit due to County Assignment Judge Michael Blee’s decision. Governor Phil Murphy promoted the legislation, which was drafted by lawmakers, as a method to support the gaming market, particularly during the COVID-19 outbreak.

Changes to local taxation programs were the key concern in the court dispute regarding the tax exemption. The program, known as PILOT, payment in lieu of taxes on real estate, allowed casinos to cover a portion of an assessment. To assist with different issues, money was distributed to the county, the city, and the school district.

The sum paid was determined by the total gaming income generated the preceding year. In 2021, the market campaigned for a legislative change to the way the sum is calculated. They triumphed, and NJ online gambling was excluded.

Casinos used the PILOT program to pay $55 million less after the reform. Due to less money being used, the change in the money flow had a detrimental impact on Atlantic City.

Liberty and Prosperity, a nonprofit organization with connections to the right wing challenged the statute, arguing that it was unconstitutional. According to the organization, the change would take into account granting the casinos in New Jersey special tax status.

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